Akshaya Tritiya: Gold, silver traders scramble for supplies
Akshaya Tritiya: Gold, silver traders scramble for supplies
Updated on Friday, May 6, 2011, 12:01 Print Email
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Mumbai: Gold and silver traders in India, the world`s biggest buyer of bullion, scrambled for supplies as they braced for strong sales for Akshaya Tritiya , pushing premiums higher, bank officials and suppliers said.

"People who were left out Rs 50,000 (USD 1,118.5) are rushing in to buy at 60,000-70,000 looking at Rs 100,000," said Mayank Khemka, managing director, Khemka Group of Companies, referring to silver. "I am doubtful whether demand will sustain after Akshaya Tritiya."

India will celebrate Akshaya Tritiya, a gold buying festival, on Friday, followed by the wedding season that will last through May.

Premiums on silver jumped to 25-30 cents on an ounce over London prices from a normal of 15 cents, while suppliers charged a premium of USD 1.8 an ounce on gold.

"Premiums are 30-40 cents more than normal at USD 1.5/1.8 an ounce," said the dealer, adding "there are a few orders in the range USD 1,490."

Traders said interest in silver rose as prices declined 21 percent from their peak of Rs 73,600 per kg.

Part of the supply problem was also attributed to a strike at Air India, which ships some bullion consignments internally. An ongoing strike by a section of pilots in the state-run airline has crippled domestic operations as it has been forced to curtail around 90 percent of its domestic flights.

"Supply is weak because of Air India strike. Premiums have jumped USD 2 (an ounce)," said Haresh Acharya, head of bullion desk, Parker Agrochem , an Ahmedabad-based wholesaler.

Gold had posted a record high of Rs 22,856 on April 30.

The World Gold Council (WGC) expects demand to rise for the festival season, with medallions, bars and the exchange traded funds, expected to be the top pick for the upcoming festival.

Being a time-tested investment asset class, gold has helped investors preserve and increase the value of their wealth, the WGC said earlier this week.

Bureau Reort

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